Nova Companys total overhead cost at various levels of activity are presented below:

Month	Machine- Hours		Total Overhead Cost
April	49,000		$	205,220
May	39,000		$	179,420
June	59,000		$	231,020
July	69,000		$	256,820

Assume that the total overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 39,000 machine-hour level of activity is:

Utilities (variable)	$	58,500
Supervisory salaries (fixed)		64,000
Maintenance (mixed)		56,920
Total overhead cost	$	179,420

Nova Companys management wants to break down the maintenance cost into its variable and fixed cost elements.

Required:

1. Estimate how much of the $256,820 of overhead cost in July was maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the $256,820 consisted of utilities and supervisory salaries. Think about the behavior of variable and fixed costs!) (Do not round intermediate calculations.)

2. Using the high-low method, estimate a cost formula for maintenance. (Do not round your intermediate calculations. Round the "Variable cost per machine-hours" to 2 decimal places.)

	Machine Hours	Maintenance Cost
High activity level
Low activity level
Change		$
Variable cost element		per mH
Fixed cost element

Y= a + bX

3. Express the companys total overhead cost in the linear equation form Y = a + bX. (Do not round your intermediate calculations. Round the "Variable cost per machine-hours" to 2 decimal places.)

	Variable cost per
	Machine-Hour	Fixed Cost
Utilities cost
Supervisory salaries cost
Maintenance cost
Total overhead cost	$	$

y= a +bX

4. What total overhead cost would you expect to be incurred at an activity level of 44,000 machine-hours? (Do not round intermediate calculations.)